Know about this scheme :-

Know about this scheme :-

Related Scheme Micro and Small Enterprises Cluster Development Programme (MSE-CDP)
Nature of assistance Matching share basis and reimbursement
Who can apply? State Govt./MSME-DIs and Autonomous Bodies
Download Scheme Guidelines


PARCHAM - Prospects & Activities Reflecting Cluster's Highlights and Achievements of MSE-CDP 


The Ministry of Micro, Small and Medium Enterprises (MSME), Government of India (GoI) has adopted the cluster development approach as a key strategy for enhancing the productivity and competitiveness as well as capacity building of Micro and Small Enterprises (MSEs) and their collectives in the country. A cluster is a group of enterprises located within an identifiable and as far as practicable, contiguous area and producing same/similar products/services. The essential characteristics of enterprises in a cluster are (a) Similarity or complementarity in the methods of production, quality control and testing, energy consumption, pollution control, etc (b) Similar level of technology and marketing strategies/practices (c) Channels for communication among the members of the cluster (d) Common challenges and opportunities.


i. To support the sustainability and growth of MSEs by addressing common issues such as improvement of technology, skills and quality, market access, access to capital, etc.

ii. To build capacity of MSEs for common supportive action through formation of self help groups, consortia, upgradation of associations, etc.

iii. To create/upgrade infrastructural facilities in the new/existing industrial areas/ clusters of MSEs.

iv. To set up common facility centres (for testing, training centre, raw material depot, effluent treatment, complementing production processes, etc).

Strategy and Approach

Given the diverse nature of the MSEs in terms of both geographical location and sectoral composition, the MSE-CDP scheme aims at addressing the needs of the industries, through well defined clusters and geographical areas. This will enable achieving the economies of scale in terms of deployment of resources as well as focusing on the specific needs of similar industries. The capacity building of associations, setting up of special purpose vehicles (SPVs), consortia, etc. which are integral part of the scheme would enable the MSEs to leverage their resources and also to have better access to public resources, linkages to credit and enhance their marketing competitiveness.

Soft Interventions

This will lead to creation of general awareness, counseling, motivation and trust building, exposure visits, market development including exports, participation in seminars, workshops and training programmes on technology upgradation, etc.

Common Facility Centre (CFC)

This will lead to creation of tangible “assets” as Common Facility Centers (CFCs) like Common Production/Processing Centre (for balancing/correcting/improving production line that cannot be undertaken by individual units), Design Centres, Testing Facilities, Training Centre, R&D Centres, Effluent Treatment Plant, Marketing Display/Selling Centre, Common Logistics Centre, Common Raw Material Bank/Sales Depot, etc.

Infrastructure Development Centre (ID)

This will lead to creation of infrastructural facilities like power distribution network, water, telecommunication, drainage and pollution control facilities, roads, banks, raw materials, storage and marketing outlets, common service facilities and technological backup services for MSEs in the new/ existing industrial estates/areas.

Financial assistance under the scheme

The financial assistances for various interventions are:- (i) Preparation of Diagnostic Study Report with Government of India (GoI) grant of maximum Rs 2.50 lakh. For the field organizations (MSME-DIs) of the Ministry of MSME, this financial support will be Rs 1.00 lakh.

(ii) Soft Interventions with GoI grant of 75% of the sanctioned amount of the maximum project cost of Rs 25.00 lakh per cluster. For NE & Hill States, Clusters with more than 50% (a) micro/ village (b) women owned (c) SC/ST units, the GoI grant will be 90%. 

(iii) Detailed Project Report (DPR) with GoI grant of maximum Rs 5.00 lakh for preparation of a technical feasibility and viability project report.

(iv) Hard Interventions in the form of tangible assets like Common Facility Centre having machinery and equipment for critical processes, research and development, testing, etc. with GoI grant upto 70% of the cost of project of maximum Rs 15.00 crore. For NE & Hill States, Clusters with more than 50% (a) micro/ village (b) women owned (c) SC/ST units, the GoI grant will be 90%. 

(v) Infrastructure Development with GoI grant upto 60% of the cost of project of Rs 10.00 crore, excluding cost of land. GoI grant will be 80% for projects in NE & Hill States, industrial areas/ estates with more than 50% (a) micro (b) women owned (c) SC/ST units.

Progress Report

Cluster Development: A total of 1018 interventions in various clusters spread over 29 States and 1 UTs in the country have so far been taken under the programme.

i) Total clusters taken 964 (till date)
• Ongoing clusters 193
- Diagnostic Study 113
- Soft interventions 12
- Hard interventions 68
• Completed Clusters 771
- Diagnostic Study 436
- Soft interventions 300
- Hard interventions 35
ii) Total infrastructure projects taken 179
- Ongoing projects 44
- Completed 135

Statement of funds sanctioned under MSE-CDP from 2011-12 to 2014-15 and 2015-16 (up to 30.09.2016).

Year Budget Expenditure (Rs. Crore)
2011-12 44.00 30.78
2012-13 49.26 23.44
2013-14 68.50 41.41
2014-15 84.60 63.18
2015-16 102.95 75.01
2016-17 135.00 37.86

Financial Progress: Expenditure of Rs.75.01 Crore has been incurred during the financial year 2015-16 (up to 30.03.2016) under MSE-CDP for carrying out various interventions.

Flow of Scheme

Last updated date : 30/09/2016